CryptoQuant Analysis Points to End of Bearish Cycle Despite Macro Headwinds

Bitcoin is showing signs of structural recovery that may outweigh current macro pressures, according to a September 17 report from CryptoQuant. Contributor Crypto Dan noted that the percentage of Bitcoin unspent transaction outputs (UTXOs) currently sitting at a loss has dropped significantly, a pattern that has historically marked the conclusion of bearish phases.

The analysis suggests that a return to a full bear market is unlikely, even as traders react to recent economic and political developments. The Federal Reserve recently implemented its first interest rate hike since 2023, and the US Senate rejected the CLARITY Act on September 15 in a 49-50 vote. The failure of the bill leaves the industry without a new framework for classifying digital assets.

UTXOs serve as the building blocks of the Bitcoin ledger, representing individual coins and the price at which they were last moved. When a high percentage of these outputs are in a loss, it indicates widespread financial distress across the network. The recent decline in this metric is viewed by CryptoQuant as a shift toward a more bullish market regime.

This outlook marks a change in positioning for the analytics firm, which had confirmed bear market conditions in late 2025. The firm now argues that on-chain dynamics, such as holder behavior and network distress levels, exert more influence over Bitcoin’s long-term trajectory than short-term political or economic events.

While the report does not provide specific price targets, it suggests that the foundation for sustained downside is eroding. Traders are currently navigating a tension between short-term macro headwinds and longer-term on-chain improvements, with the primary uncertainty being whether the Fed's tightening cycle will create enough pressure to offset the positive network signals.